When Does Health Insurance Expire After Leaving a Job?

By Alicia Wooldridge, MD
Medically reviewed checkmarkMedically reviewed
April 5, 2022

Many people who are unhappy in their jobs or would like to leave to do something different like pursue freelance work or start a business of their own may hesitate because of the high cost of health insurance.

If you’re curious about how a career change would impact your health coverage, what your options are for coverage once you leave a job, and the financial impact on you and your family, keep reading.

In this article, I’ll give you the facts about when health insurance expires after you leave a job.

I’ll tell you what you should do to prepare to leave your job, including evaluating your post-employment options for healthcare coverage.

With this information, you’ll be ready to ensure that no matter what choice you make, you have the healthcare coverage you and your family need.

When Does Health Insurance Expire After Leaving a Job?

Most of the time, when you either resign from a job or are let go, your health coverage will expire on the last day of the month in which you work your final day. 

That means if you’re planning to leave your job, it’s a good idea to resign early in the month so that your health coverage will continue for the rest of the month.

That’s a little bit of extra security if you need to figure out your health insurance and healthcare needs after you leave.

Termination

If you’re terminated, you unfortunately don’t decide when your last day is.

Still, you may be able to negotiate extra time for coverage if your employer is amenable; it certainly doesn’t hurt to ask. 

In addition, if you have no prospects for employment, you may be eligible for special enrollment in the healthcare marketplace.

Your children may also be able to get coverage through the Children’s Health Insurance Program Reauthorization Act (CHIPRA), offered through state Medicaid plans.

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Preparing to Leave a Job

If you’re looking to make a change and your employer currently provides you with health insurance, there are a few things you should consider before you put in your notice. 

We recommend familiarizing yourself with your company policy regarding available post-employment coverage.

Compare your coverage options with those in the marketplace to ensure you’re getting the coverage you need for the best price. 

If you cannot find information about this in company handbooks or websites, you can ask your HR department about insurance costs under COBRA (which allows you to continue your health insurance after you leave).

Note: Be mindful that this question will likely raise a flag that you may be looking at leaving!

Health Insurance Options 

Your options for health insurance coverage after you’re separated from your current employer’s plan are limited but straightforward:

  • You can continue coverage through your employer and pay the premiums associated with COBRA. 
  • You can get insurance through a family member’s plan, if available. 
  • You can sign up for short-term insurance. 
  • You can sign up for coverage through the healthcare marketplace. Typically, even if you’re out of the enrollment window, losing a job is a special event that allows you to sign up for a new policy.

COBRA 

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives you the right to choose to continue group health benefits provided by your employer for a limited period after you stop working there.

However, you’ll be responsible for the entire cost of the insurance premiums unless you’ve negotiated an exit agreement with your employer that covers part of the amount. 

Before signing on for COBRA, it’s a good idea to check to see if there are less costly options out there.

However, in certain situations (like if you’ve already met your annual deductible), COBRA may be your best option.

Join a Spouse, Partner, or Parent’s Plan 

If your spouse, partner, or parent (you have to be under 26 years old to join a parent’s plan) has insurance, whether through their employer or a private plan, you may be eligible to join their program.

Your family member should be able to find out from their HR department (or the insurance company) how soon you can join their current health insurance plan.

Some plans require that new additions be done during open enrollment periods only, in which case you would need to figure out an alternative solution until you can be added. 

Short-Term Insurance 

Suppose you’re planning to enroll in a health insurance plan with a new employer or you need to wait for the open enrollment period to join a family member’s plan.

In this situation, short-term health insurance might make sense. 

Some short-term plans have restrictive maximum limits, high copays or deductibles, or offer no coverage for pre-existing conditions; however, some plans do offer comprehensive coverage at a reasonable cost. 

Shop around to see what options exist.

You may have to pay more for a while until your other insurance kicks in, but it’s often worth it to make sure you have health insurance and you’re covered in the event of an emergency. 

Health Insurance Marketplace 

Always compare any price quotes you get from insurers with what’s available on healthcare.gov.

If your employment situation has changed, you’re likely eligible for special enrollment and don’t have to wait for open enrollment, which starts November 1 and runs till January 31. 

The marketplace offers an array of insurance options to meet your needs and is definitely worth exploring.

From high-deductible plans that cost less to plans that are a bit more expensive but cover all of your doctor’s visits, you can find something that works for your situation.

Depending on your average annual income and other considerations, you might also be eligible for a subsidy that offsets the total monthly cost.

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Does health insurance end the day you quit?
Typically, health insurance runs until the end of the month in which you quit. That means if your last day was March 3, you may have health insurance until March 31 of that same year. By law, any company with 20 or more employees must offer COBRA coverage to an employee who is leaving, no matter the reason. COBRA extends your existing healthcare plan for a specified amount of time. Usually, you're responsible for the entire cost of the coverage.
How long are you covered by insurance after leaving a job?
Each employer has different guidelines and benefits. Check with your HR department to find out your company's policy so you won't be surprised when your employment ends.

K Health articles are all written and reviewed by MDs, PhDs, NPs, or PharmDs and are for informational purposes only. This information does not constitute and should not be relied on for professional medical advice. Always talk to your doctor about the risks and benefits of any treatment.

K Health has strict sourcing guidelines and relies on peer-reviewed studies, academic research institutions, and medical associations. We avoid using tertiary references.

Alicia Wooldridge, MD

Dr. Alicia Wooldridge is a board certified Family Medicine physician with over a decade of experience.

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